Bill Shorten signals fight over charity crackdown

Labor has sent its clearest signal yet it will not support the Turnbull government's foreign donations crackdown in its current form, with Bill Shorten declaring he cannot support laws that would "silence" local charities.

While Labor supports a ban on foreign donations to Australian political parties it is increasingly concerned about how the Coalition's laws might stifle the not-for-profit sector, preventing them from taking part in political debates.

"Labor has led the way on reforming political donations and removing foreign influence from the political process. We’ll keep working with the government to ban foreign donations, which is already Labor policy," Mr Shorten said.

"I believe we can clean up donations without silencing our charities. Labor is not interested in laws which punish Australian charities and not-for-profits."

Opposition Leader Bill Shorten has drawn a line in the sand on the bill.Credit:Alex Ellinghausen

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While the government's legislation is still being examined by a parliamentary committee, Mr Shorten's comments make it clear the opposition is unlikely to support the bill without significant changes.

The Greens have also previously made it clear they will not support any legislation that shuts down civil society debate.

Special Minister of State Mathias Cormann has introduced the legislation into the Senate but debate has not yet commenced. Speaking to the bill in December, Senator Cormann said the legislation would not prevent third parties including charities from taking foreign money, but rather from using that money on political expenditure.

"It is important that third party campaigners are covered by the measures in the bill to level the playing field. Banning foreign gifts to political parties - but allowing third parties to use foreign gifts to incur political expenditure - would have the effect of allowing foreign interests to fund political campaigning by some entities but not others," he said.

Acting Prime Minister Mathias Cormann.Credit:Jamila Toderas

Senator Cormann said on Sunday that Mr Shorten's own bill to crack down on foreign donations "hits charities much harder than ours".“In his Bill he doesn’t even exempt charities to enable foreign donations to fund non-political expenditure," Senator Cormann said. “Our Bill allows charities to seek and receive foreign donations to fund their charitable and other non-political activities but applies the same prohibition on foreign donations in relation to political campaign expenditure to them which applies to all other political actors."

A recent analysis by the Parliamentary Library found: "It seems reasonable to conclude that the significant additional regulatory requirements imposed on charities and registered organisations will prove to be a disincentive for these organisations to engage in political activity in an effort to avoid the requirements."

The bill seeks to introduce a new class known as "political campaigners" into the Electoral Act. Such organisations would be forced to comply with the same disclosure and reporting requirements as a political party.

These would be defined as organisations that have incurred more than $100,000 worth of political expenditure in any of the previous four years, or have incurred $50,000 or more in political expenditure where that represents at least half their annual budget.

The Australian Electoral Commission defines political expenditure as involving money spent on expressing views on a political party, candidate, MP or election issue. It also includes the printing and distribution of certain material and conducting opinion polling or other research relating to a federal election or the voting intention of electors.

Labor frontbencher Andrew Leigh has accused the Coalition of a "war on charities" and says the bill "conflates political campaigning and issue advocacy".